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(Kitco News) - Comex gold prices ended the U.S. day session moderately higher Monday, on some short covering and bargain hunting buying interest following Friday’s big sell off. Gold prices overnight hit a fresh two-month low in the aftermath of Friday’s stronger-than-expected U.S. employment report. Gains in gold Monday were somewhat limited by a stronger U.S. dollar index that hit a fresh two-month high overnight. December gold last traded up $9.90 at $1,685.10 an ounce. Spot gold was last quoted up $8.00 at $1,685.50. December Comex silver last traded up $0.323 at $31.18 an ounce.

It was a modest “risk-off” trading day in the market place to start the new trading week. The U.S. presidential election on Tuesday is one big uncertainty for the market place, and the outcome will begin to be digested on Wednesday morning. There is a big leadership conference in China later this week, and there are key European Union events occurring this week. There is a vote in Greece’s parliament this week on new austerity programs. Spanish bond yields are on the rise Monday following some more dour economic data coming out of Spain. Australia’s central bank also meets this week to discuss its monetary policy. All of the above is making for skittish traders, many of whom have moved to the sidelines until after the U.S. election.

The U.S. dollar index traded higher Monday and hit a fresh two-month high, boosted in part on the strong U.S. jobs data Friday and on short covering. The U.S. dollar bears still have the overall near-term technical advantage but the bulls have gained good technical momentum recently. Meantime, Nymex crude oil prices were slightly higher Monday and did hit a fresh four-month low overnight. The crude oil bears have the overall near-term technical advantage. These two key “outside markets” will continue to have a significant daily influence on gold and silver prices.

In other news, reports said physical demand for gold coming out of India is on the rise due to its festival season and because recent price declines are prompting bargain hunting.

The London P.M. gold fixing was $1,683.50 versus the previous P.M. fixing of $1,685.00.

Technically, December gold futures prices closed near the session high Monday after hitting a fresh two-month low early on. Friday’s price action produced a bearish weekly low close in gold and also re-established a four-week-old downtrend on the daily bar chart as the bulls have faded badly. The gold bulls’ next upside price breakout objective is to produce a close above solid technical resistance at $1,700.00. Bears’ next near-term downside breakout price objective is closing prices below solid technical support at $1,650.00. First resistance is seen at $1,690.00 and then at $1,700.00. First support is seen at Monday’s low of $1,672.50 and then at $1,660.00. Wyckoff’s Market Rating: 5.0

December silver futures prices closed nearer the session high Monday after hitting a fresh two-month low early on. Prices careened lower on Friday and produced a bearish weekly low close. Price action Friday also re-established a five-week-old downtrend on the daily bar chart. The silver bears now have the overall near-term technical advantage. Bulls’ next upside price breakout objective is closing prices above solid technical resistance at last week’s high of $32.695 an ounce. The next downside price breakout objective for the bears is closing prices below solid technical support at $30.00. First resistance is seen at $31.535 and then at $31.75. Next support is seen at Monday’s low of $30.655 and then at $30.50. Wyckoff’s Market Rating: 4.0.

December N.Y. copper closed down 105 points at 347.10 cents Monday. Prices closed near mid-range and hit a fresh two-month low. A stronger U.S. dollar index today helped to pressure copper. Copper bears have the solid near-term technical advantage. Copper bulls’ next upside breakout objective is pushing and closing prices above solid technical resistance at 360.00 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at 340.00 cents. First resistance is seen at 350.00 cents and then at 362.50 cents. First support is seen at Monday’s low of 344.85 cents and then at 342.50 cents. Wyckoff’s Market Rating: 3.0.

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